FTX Plans to Sell Trust Assets Worth $744 Million Amid Bankruptcy
Date: 2023-11-06 Author: Dima Zakharov Categories: BUSINESS
Sale of FTX Trust Assets as Part of Bankruptcy
Cryptocurrency exchange FTX and its debtors have announced their intention to sell trust assets worth approximately $744 million as part of their bankruptcy proceedings. They have applied to the Delaware state court in the USA, seeking approval for this deal. According to FTX representatives, the sale or transfer of these assets will help the company prepare for upcoming creditor payments and enable them to act swiftly.
The trust assets, stored in 5 Grayscale trusts amounting to around $691 million and 1 Bitwise-managed trust worth $53 million, represent digital assets that investors can access without necessarily owning them. This allows investors to reduce price volatility risks and maximize their profits.
Furthermore, selling the trust assets through an agreement with one or multiple buyers will reduce costs and eliminate delays associated with filing petitions for each individual trust. This step is taken in the context of FTX's financial difficulties and their battle with bankruptcy, allowing the company to manage its assets and obligations to creditors efficiently.
Legal Troubles for FTX Founder
Last week, FTX founder Sam Bankman-Fried was found guilty of deceiving clients and creditors by a jury. The final sentencing date is set for March 28, 2024, and theoretically, he could face up to 115 years of imprisonment. However, in reality, the expected sentence ranges from 15 to 20 years.
This legal proceeding adds to the already complex situation FTX is facing, with financial challenges and bankruptcy. In the event of the founder's conviction, this could have a significant impact on FTX's future and its ability to regain its position in the cryptocurrency market.
The sale of trust assets worth $744 million and the legal proceedings involving FTX's founder present significant challenges for the cryptocurrency exchange. The company aims to address its financial issues through the sale of assets while concurrently dealing with legal charges, leaving its future uncertain. Successfully resolving these problems will be crucial for maintaining stability and long-term sustainability for FTX in the cryptocurrency market.
